OpenAI has launched its latest reasoning model, OpenAI o1, in API form, along with three new sets of tools for developers, in a move seen by analysts as a "smart" and "defensive" strategy to stay competitive with AWS, Google, and Microsoft in the AI development space.

The release, part of OpenAI's 12 days of Shipmas campaign, includes the production-ready OpenAI o1 in API, which contains vision capabilities that allow it to "reason over images to unlock many more applications in science, manufacturing, or coding, where visual inputs matter." Other enhancements include function calling to connect o1 to external data and APIs, as well as an API parameter that gives developers the ability to "control how long the model thinks before answering."

Industry analyst Jason Andersen, VP and principal analyst with Moor Insights & Strategies, described the move as "something of a defensive move, since we have seen AWS, Google, and Microsoft releasing API-based multi-model development frameworks such as Bedrock and AI Foundry." Andersen noted that these frameworks do have OpenAI as a potential model target, but they also have new features such as model routing, which means that there is no guarantee that the framework vendor will consistently use OpenAPI.

In addition to OpenAI o1, the company has also launched enhancements to its Realtime API, which allows developers to create low-latency, multi-modal conversational experiences. The Realtime API currently supports both text and audio as inputs and outputs, as well as function calling capabilities. Key among the enhancements is integration with WebRTC, an open standard that makes it easier to build and scale real-time voice products across platforms.

OpenAI has also introduced Preference Fine Tuning, a new model customization technique that makes it easier to tailor models based on user and developer preferences. Furthermore, the company has launched new SDKs for Go and Java, both available in beta. Andersen described the latter as "quite interesting, since those are two languages heavily used by developers who are using the public cloud. This and the APIs provide a meaningful alternative to someone just using the models a cloud provider has ‘on the shelf.’”

However, Forrester senior analyst Andrew Cornwall noted that the new tools are primarily for AI developers, and it will take some time for the benefits to trickle down to other users. Cornwall highlighted the vision support capability as a key feature, saying it is "probably of most interest" among the new tools. He also noted that the latest o1 model should return more accurate responses and report fewer refusals than the preview.

Cornwall added that math and coding capabilities have improved significantly from the preview, and the new parameter to adjust reasoning effort will let developers balance between accuracy and speed. He also noted that the integration with WebRTC voice support will be particularly useful, as a pause for a few seconds is sometimes acceptable at a keyboard, but not when having a conversation.

Thomas Randall, director of AI market research at Info-Tech Research Group, commented that with increased openness and flexibility for developers, OpenAI is aiming to maintain its market share as the go-to model provider for builders. Deeper dependencies may form between OpenAI's model provision and the software companies that are already utilizing OpenAI for their own AI-enhanced offerings.

In conclusion, OpenAI's latest release is a strategic move to stay competitive in the AI development space. While the new tools and capabilities may not be revolutionary, they do provide a significant improvement over previous models and will likely be welcomed by developers. As the AI landscape continues to evolve, it will be interesting to see how OpenAI's move affects the market and its relationships with other major players.